If you're new here, this blog will give you the tools to become financially independent in 5 years. The wiki page gives a good summary of the principles of the strategy. The key to success is to run your personal finances much like a business, thinking about assets and inventory and focusing on efficiency and value for money. Not just any business but a business that's flexible, agile, and adaptable. Conversely most consumers run their personal finances like an inflexible money-losing anti-business always in danger on losing their jobs to the next wave of downsizing.
Here's more than a hundred online journals from people, who are following the ERE strategy tailored to their particular situation (age, children, location, education, goals, ...). Increasing their savings from the usual 5-15% of their income to tens of thousands of dollars each year or typically 40-80% of their income, many accumulate six-figure net-worths within a few years.
Since everybody's situation is different (age, education, location, children, goals, ...) I suggest only spending a brief moment on this blog, which can be thought of as my personal journal, before delving into the forum journals and looking for the crowd's wisdom for your particular situation.

It is no secret that our econometric systems only capture “value” whenever there is a transaction. More accurately, they only measure price. So for instance, if I break a window, I create so-called economic value as a new window has to be produced and installed even though the world is poorer for the broken window and the effort required to get back to the pre-broken stage. Similarly, the Exxon-Valdez oil spill significantly boosted the Alaskan economy while causing massive damage at the same time.

I remember some time ago, when some group took the functions of a housewife and folded them with the going salary of the various functions, like a CEO, an accountant, a cook, a psychologist, etc. They arrived at low six figure value, like $100,000 / year.

Now, I just realized that as a blogger, I could do something similar. I use the blog metrics of this post and see that currently, I have an average of 3045 visitors per day who spend an average of 3:35 minutes on my site. That translates into 181.9 hours a day, 365 days a year, say.

Now, presumably, and this is a stretch, rather than reading my silly rants, whoever is reading this could be out earning money (I know it doesn’t work that way if you’re salaried). A good number for the average hourly wage is $17. Of course I don’t know if people who read ERE comprises a good cross section of the population. Actually, I suspect they don’t(*), but bear with me:

To get my annual salary in terms of services I provide as a blogger, I compute $17/hour x 365 days/year x 181.9 hours / day = $1,128,689.5/year.

Like the housewife, I don’t see any of that money, but that does not mean that the value is not there. Of course one could also argue that this is the amount of money I’m causing people to waste.

(*) Bonus question: Do you think the average reader of ERE earns more or less than $17/hr?

It has been argued that ERE should be considered more as a form of entertainment. It may then make sense to compare it to a movie ticket which tend to go for $5/hour.

41 users responded in " The salary of a blogger: What you should be paid "

I believe your blog attracts more readers who make above $17/hr than below.

Alex said,

I make $8.55 an hour, but your readership in general probably makes more.

josh said,

I am currently a student studying accounting, back home in SF for the summer. I just found your website a week ago and probably have read every article. Even when I read a new piece of yours I am captivated to go back and reread an article of yours.

Some of the most amazing things I have ever read.

Josh

AlexK said,

I bet your readers’ average wage is double that. You are destroying productivity because you are inspiring people to stop working sooner. You are creating more happiness though which is what really matters.

Frugal in Europe said,

My income is slightly higher but will be much higher after my defense. Like the others I suspect that the average income of your readership is higher, or will be higher in future as it seems like a fair amount of students read your blog as well.

Jan said,

Making more than twice that. It won’t be easy to retire knowing I’ll probably never have that kind of income anymore.

Knobby Kabushka said,

I would say under $17, because I have found that for the most part, the ones that have higher working income, the more driven they are to make it and so would be less inclined to read about early retirement.

Patrick said,

I take issue with your examples of value “creation” – you only list harmful things. Is that the only way value/price is created?

I’ve never taken an economics course, but the authors of “Your Money or Your Life” tell us to compute our hourly wage differently–including commuting time, etc.–so your true hourly wage is quite a bit lower. Then, of course, there are taxes. Then there is the possibility that people are reading your blog at work.

On the other side, since you encourage people to think in a different way, you could also compute how much people EARN reading your blog. Money saved provides a tax-free wage.

I could go on…and, no, I’m NOT at work.

Kevin M said,

I’m above the average personally but I bet that average is pretty close.

I find KK’s comment interesting though because my guess is you attract roughly equal numbers of a) those below the average looking to cut expenses dramatically so they can retire and b) those making above the average that want to get out of the rat race early but still live comfortably.

brauhster said,

I retired from a profession, paying several times your average. This included insurance, retirement, & other benefits. Needless to say my income is now much less, but life is much better. I worked past SS full retirement age.

George said,

Closing in on 2.5x average hourly wage.

Among your respondents, it’s looking like we make more than the average. I think this is because your blog’s readership is biased towards those who have more education and put more effort into making their “pile” so they can retire early.

shawn said,

I am above $17.

David said,

I make less than half the average 🙁

Squirrel Most Frugal said,

I make about $9.40 per hour. I think your readership falls into two potential groups.

One group who earns more than $17/hour and want to retire early.

The second group who earns less, but is searching for ways to get ahead of the pack and achieve their goals.

All your regular readers have the “millionaire mind” in actively seeking ways of getting ahead or achieving what they want to achieve. This is independent of income.

I make about 2.5 times the $17/hour. I would think that your readers’ wages run from the minimum up past my hourly rate. Your blog is interesting, and crosses many demographics.

Debs said,

I make no money, depending how you run the numbers. I am on scholarship, and I am an RA (that takes care of housing). Even if you count those for cash value, it comes out to be a very small number when you take into account the time I spend going to class and studying. I work about two months per year, and the last time I worked I made $10/hr. I wonder if any of your other readers don’t work or only work a few months of the year?

Mo said,

It’s incredible to see the diversity of incomes. By standard calculating I’m above the $17. If I factor in “on-call” time, and if I were to average things over a few years to include some of the lower paying educational years, who knows…

I think that suggesting that the blod removes $300k+ of productivity is faulty– even if people read the blog at work. An individual’s production is not evenly spread over a time period for many reasons.

To a degree the notion that every moment is an earnings opportunity is flawed. All people waste time. It seems that if you are unwilling to waste time you will be incredibly unproductive, because no one else will be able to relate to you in order to work with you, and your individual output will suffer due to the isolation and rejection.

Steven said,

These are amusing calculations.

At my workplace the bigwigs call “Townhall” conference calls where they will routinely issue calls to look for ways to cut costs.

We regularly entertain ourselves during these meetings calculating how much money it is costing the firm by having say 500 people being paid $30 an hour listening to management rant!

Per your statement: “Now, presumably, and this is a stretch, rather than reading my silly rants, whoever is reading this could be out earning money…”

This is definitely a stretch. I worked several years in customer service. Inevitably, I’d talk to someone who had experienced poor service from my company, and it would take some time on the phone with them to unravel the damage. Some customers would get irritated and remind me that they get paid $X per hour and that we “owed” them that money to make up for lost time. I never agreed with that. When you decide to do business with someone, you are entitled to be compensated for failure to deliver promised goods and/or services, but you are not entitled to draw the equivalent of your hourly wage from them if something goes wrong. Similarly, when you are stuck in traffic, waiting in line at McDonald’s, sleeping, or reading Early Retirement Extreme, you are spending time, but not necessarily earning any money. Nobody can work all of the time, so nobody should presume that every moment of their life represents a potential (lost) earning opportunity.

jab said,

As a health care professional earning $55/hr, I can’t get enough of what you have to say! Having gone down a slightly different road of home/rental property ownership (closing in on paying off 3 different mortgages in my 15 year career (we have rental buildings)I am happily working part time(in said career)and trying to put all your principles to work… My opinion is that your readership is probably a little more educated and thus being compensated at a higher rate also…just a guess!

Livin' La Vida Iraq said,

Being on salary right now I don’t make much per hour. When I’m at home being a “normal” person I make $10/hr. Trying to support myself and a child has been a bit difficult in the past. I recently purchased a 900 sqft condo with no associaion fees for $25K. I know you say not to puy property, but I’m hoping this will help us to reach a 50% savings goal since I will no longer be paying rent (no mortgage either, I paid cash). Heres to reducing costs since I’m not having much luck increasing my income.

My initial thought was that the vast majority of readers would make more, but after reading all the comments I would have to agree with Squirrel Most Frugal’s “two camps” theory.

I would probably say 2/3rds make more (closer to double) and 1/3rd make $10 or less, which probably puts the average over $17. It is interesting that almost no one seems to make in the low teens to the high teens. Is that because there are few jobs that pay in this range? Or, is it because people that make that amount tend to be paycheck to paycheck people with a level of living they believe they are “happy” with? Thus, they don’t actively seek good financial information.

This is a good point. I think a lot of people wish they could get paid more for blogging. It is a valuable resource to me and I am sure many others. Anyways, keep of the good work.

jane said,

Livin’ la Vida Iraq, please tell where you found the $25K condo…in Iraq? And, like Brauhster, I am retired (not very early but fairly extreme)and discovering there are lots of interesting tricks and challenges to maintaining enough income to pay the bills, but not too much, or else you’re disqualified for some of the benefits. E.g., Medicare Part D is worse than useless, but CT has a program called ConnPays for people with incomes under $33K (for a couple). Social Security gives us $22K, but we made another $12K last year….you get the idea!
And that tells you where we fall on the income ladder.

2ravens said,

I make around $40/hour but am in the group trying to make more to retire early.

snoworld said,

i make 32 dollars an hour. But on the back hand i only work part time

shootdang said,

I start out making more than $17, but then the big bad tax man comes along and takes a good chunk. I pretty much work for free 4 months out of the year… My goal in life is to stop paying so much in taxes asap.

5.8x when I work. But I try to not work full-time since my wife works too, and we’d rather spend more time together. I would’ve guessed 75 higher/25 lower and skewed higher in the forums with all the engineers hanging out. The blog is more diverse in every metric it seems.

Ye olde broken window fallacy.

I hope you get your $17 per hour. I’m quickly learning there is a very loose coupling of value and price after making some flash games. I’ve so far managed to waste 1232 hours of player’s time with my game (or did I entertain them?) and make a whopping $3.64 in cash.

I make twice that as gross but once you factor in all the non work activities I have to do to get to work, aka commute and biz clothes, I am making not much more.

I read this blog at work because I don’t want to spend my “free” time on a computer when I get back to my RV after work or on the weekends. Sometimes I use my lunch hour to do it.

So I am causing a small financial drag on my company for lost productivity but I am taking my savings and investing in companies. This allows them to do far better things then I am capable of doing on my own.

I concur with Darren.
I make 2x the $17/hr (full time) plus a 15-20%% return off of every $10k invested in High Yeild REIT Dividends at the moment, Which only matters if one keeps a High Savings Rate 😉

But every $30k invested gets me a month per year of my life back and closer to FIRE.

I bought your book yesterday after reading every article for the past 4 months, it will arrive in a few days and I look forward to reading it many times, and having it as a goal guide!

As for hobbies turned investments, I believe every person should start a business at one point in their lives, almost like it’s a requirement to obtain a shelter in your life.

HSpencer said,

Rather than think of one’s income in “per hour” amounts, I tend to think of it in cash flow. If someone makes a small hourly figure, and that person is totally debt free, then the person has a full cash flow of wages earned.
Suppose a doctor of medicine makes $250.00 a year. Said doctor buys a mansion, and a Cadillac and a vacation home in two different countries, and has extensive wardrobes, and entertainment costs, and charities, and other large expenses. How soon does the 250K earned evaporate in the course of the year? So if all this extra stuff is “financed” with extraneous interest charges (which is probably not even considered by our doctor), then the cash flow is closing in on small. Be it $7.50 an hour, or even $75.00 an hour, the important result of the formula will be the monthly cash flow. Here is the wisdom of ERE principles. Keep your cash flow tuned, and your investments producing. In the end, your hourly wage will be zero important. Nor would you even need to compute an hourly wage. It is all about the cash flow. In theory, the 7 buck an hour wage can equate to being more wealth than the 250K doctor.
All depends on how you look at it.

HSpencer said,

“Suppose a doctor of medicine makes $250.00 a year”. EDIT dropped one zero $250,000 a year instead!!

I am now thankful to have made the very first error of my life. I should sleep better tonight knowing I am like everyone else!

RD said,

This perspective reminds me how the media companies were reporting “lost sales” due to piracy and came up with some incredibly bloated big figure. They conveniently ignored the fact that many “sales” would not have been happened at all due to geographic and price barriers.

I’m not sure what direction this post was meant to go, satire? tongue-in-cheek? just-a-rant?

Interesting way of thinking about things. I think the average ERE reader earns much more than $17, this might be because they’re always looking to save money by making money. Interesting article, thanks for posting.

Belle said,

So I want to know where you go to the movies for $5?
If I go to a theater, a movie costs me $12 for an adult during the matinee. If I get a movie from the library, it’s free, which is what I typically do.

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